LAS CRUCES - Eddie Groth and his wife, Sue, bought a car this summer. The Las Cruces couple picked up a new Buick Lesabre from the Sisbarro Dealerships.
My son and I were talking about it and he said he heard that there is good trade-in (value) for used cars," said Groth, who decided to trade in his older car, also a Buick. "I was happy with what I got."
For the better part of three years, gas prices have been north of $2 per gallon and even spiked up to near $4 earlier this year. That has indeed helped in the sale of used cars.
"The used car business is great," said Rick Nezzer, director of marketing for Sisbarro. "Overall, business is solid."
In the Las Cruces area, dealers admit that sales could be better, but with all the concerns about the economy, they claim to be pleased with how things currently stand.
"We've had a steady flow of customers," said Jon Caldwell, sales manager with Borman,
"Hybrid (sales) are on fire," said David Wilson, spokesman for Borman.
Still, marketing information and services giant J.D. Power and Associates recently cut its 2011 sales forecast last week by 2 percent, to 12.6 million new cars and trucks. It cut its 2012 forecast by 3 percent, to 14.1 million.
"We're not getting back to what was considered normal or healthy as quickly as possible, but it's still a pretty strong progression," says Jeff Schuster, executive director of global forecasting for J.D. Power. Sales bottomed at 10.4 million in 2009.
Commerce Department reported last week that U.S. factory orders rose strongly in July on the biggest jump in demand for autos in more than eight years.
Raymond Palacios owns Bravo car dealerships in Las Cruces and El Paso. He said when gas prices rose in he Spring, it affected car buyers the same as it did several years ago, but summer sales have been acceptable.
"By and large, with all the problems the economy is facing, the auto industry here, so far, has not been quite as affected (as other locations)," Palacios said.
He pointed out that the time of year when dealers try to sale off current models to make room for next year's models is fast approaching.
"Typically we're about to have our model year clearance," he said.
The earthquake and subsequent tsunami in March in Japan caused
significant supply chain disruptions in the auto industry, but not for all. Korean manufacturers like Hyundai did not see any setback at all while some U.S. companies like Ford and General Motors experienced a few problems getting enough of some of the parts that are made in Japan.
Toyota, though, had some catching up to do and Kevin Kavanagh, manager at Las Cruces Toyota, said the situation has improved.
"Right now, Toyota has upped its manufacturing all vehicles are on track to be sent to the dealers," he said. "We're just waiting for the transport infrastructure to catch up and get to the stores."
He said sales have been good, though, and there continues to be high demand for vehicles like Prius, Camry and Corolla models.
"There is always a high demand for them," Kavanagh said. "Typically you don't have as many as those as you would like."
Nezzer said that the only Japanese line Sisbarro carries is Mitsubishi and it has not experienced delays.
Palacios said there were "some setbacks, but nothing significant."
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